Noting that state Medicaid experiments must fulfill the basic purposes of the program, Judge Harry T. Edwards told a Justice Department attorney, “You are failing to address the critical statutory objective” of providing vulnerable residents with health coverage.
The attorney, Alisa Klein, of Justice’s civil division, said the administration believes that requiring low-income people to work, train or volunteer can improve their health and ultimately help them get private health plans, freeing up money that states could use for additional Medicaid services.
“The other things you say may be laudable goals, but to say they outweigh the principal goal [of Medicaid] seems a bit strange,” said Judge David B. Sentelle, nominated by President Ronald Reagan and the only Republican appointee on the panel.
The judges also were dismissive of the administration’s argument that work requirements for Medicaid merely extend an idea embedded for two decades in the nation’s main welfare and food assistance programs. Sentelle said the analogies “are not comparable at all,” because Congress specifically wrote that financial self-sufficiency is a goal of the other two programs but has never included that in Medicaid law.
The hearing turned on controversy over the Trump administration’s promotion of a fundamental redesign of Medicaid, which began as a central piece of Lyndon Johnson’s 1960s-era anti-poverty Great Society — and is today the country’s largest public insurance program.
Work requirements typically compel able-bodied adults to report every month that they have a job or are in other work-related activities for a specified number of hours in order to stay on Medicaid.
In twinned opinions in late March, Judge James E. Boasberg, of the U.S. District Court for the District of Columbia, halted work requirements that began last year in Arkansas and blocked similar rules that Kentucky has tried to start. The administration is appealing that ruling.
Kentucky and Arkansas are among nine states that have gotten approval from the Department of Health and Human Services to impose such requirements. Most of those plans have not yet taken effect. Several other states have asked for federal permission and are awaiting an answer.
Early last year, Kentucky became the first state to win federal permission to impose “community engagement” requirements that certain able-bodied adults must work or prepare for a job. Boasberg’s ruling in March was his second ruling against those changes.
In the summer of 2018, Boasberg blocked Kentucky from moving forward, ruling that HHS had not considered the effects on poor people needing insurance, including a state forecast that as many as 95,000 residents could lose coverage.
After the judge’s first decision, HHS officials reviewed Kentucky’s application again and approved it without changes.
With Kentucky’s requirements blocked, Arkansas began phasing in “Arkansas Works” in June 2018, and more than 4,000 recipients became the first in the country to lose coverage that September. Some 18,000 had been removed from the program by the time Boasberg blocked the requirements in March.
Boasberg is handling two other related lawsuits. In July, he blocked work requirements in New Hampshire shortly before they were to begin. He has been assigned a similar lawsuit filed last month against Indiana’s requirements, which went into effect earlier this year with state promises that it would be a less-restrictive version with no one removed from the rolls.
During Friday’s oral arguments, Judge Cornelia Pillard asked Klein, the Justice attorney, whether the government was “relying on the notion that work or work substitute makes people healthier.”
Klein said HHS’s leaders were mindful of research evidence that working correlates with better health, though there is no clear causal connection.
Pillard replied: “The question is, at what expense for coverage?”
At another point, Edwards invoked the lower-court opinion in asking Klein, “Could you tell me why Judge Boasberg’s very thorough analysis isn’t eminently correct based on the [HHS] secretary’s failure to consider the effects on enrollment?”
Klein did not address the question directly. She said the district judge had assumed people who leave Medicaid would become uninsured, when he should have considered that some would get jobs that come with health benefits and others could buy health plans through Affordable Care Act marketplaces.
Ian Gershengorn, a partner at Jenner & Block law firm who argued on behalf of Kentucky and Arkansas Medicaid recipients, said that Trump health officials “nowhere addressed the effect on coverage loss,” even though Kentucky had estimated in its application to HHS “coverage losses approaching 100,000, and 20 percent in Arkansas were kicked off the program.”
The judges’ questioning of Gershengorn was less pointed than of the government lawyer. The panel did not say when it plans to rule in the case.